Key Highlights

• TSLX's third-quarter base Dividend of $0.42 per share trades ex-date and Record Date September 15, 2026, payable September 30.

• The base dividend was reduced from $0.52 a year earlier, part of a policy reset targeting a 10%-10.5% return on equity.

• Second-quarter net Investment income of $0.43 per share exceeded the reset $0.42 base dividend, with NAV stable at $16.24 per share.

• Repayment activity increased approximately 70% sequentially, with management citing early signs of a pickup in M&A activity.

Sixth Street Specialty Lending's (NYSE:TSLX) $0.42 base dividend trades ex-date and record date September 15, payable September 30. The base dividend was reduced from $0.52 a year earlier as part of a policy reset targeting a 10%-10.5% return on equity, and this quarter's $0.43 of net investment income exceeded that reset level, with repayment activity up approximately 70% sequentially to $192 million.

Dividend Program and Shareholder Returns

TSLX declared a third-quarter 2026 base dividend of $0.42 per share, payable September 30 to shareholders of record and ex-dividend date September 15, with no supplemental dividend this quarter. This Base Rate reflects a reduction from the $0.52 per share paid a year earlier, part of a policy shift the company describes as a "responsible, sustainable" approach. Trailing twelve-month base dividends were $1.80 per share and trailing supplemental dividends were $0.09; supplemental distributions depend on Taxable Income and realized gains and have varied across recent quarters rather than recurring at a fixed rate.

About the Company

Sixth Street Specialty Lending is a Business Development Company specializing in lending to middle-market businesses, with a portfolio consisting predominantly of senior secured loans and externally managed by Sixth Street.

Financial Performance Behind the Payout

TSLX generated net investment income of $0.43 per share and Net Income of $0.43 per share in the second quarter, corresponding to annualized returns on equity of 10.6% and 10.5% respectively, both down from 12.7% and prior-year levels as lower base rates pressured portfolio yields. NAV remained unchanged at $16.24 per share. Total investments at Fair Value were approximately $3.302 billion at June 30. Repayments increased approximately 70% sequentially to $192 million, and management said it expects improving M&A activity to support higher portfolio turnover in the second half of 2026.

Reset Dividend and Coverage

The reduction from $0.52 to $0.42 reflected lower base rates compressing portfolio yields. This quarter's $0.43 of NII exceeded the reset $0.42 level. New investment origination spreads were 690 basis points, which the company said is above the BDC peer average.

Outlook

Whether NII continues to exceed the reset $0.42 base level through subsequent quarters is the primary metric for the dividend's coverage going forward. Portfolio turnover trends as M&A activity picks up, following this quarter's 70% sequential repayment increase, are the secondary variable to track.